Page 19 - 2020 Startup Guide

3. When can a FAU start-up request a license?
After broad marketing efforts, if the FAU start-up is the best choice for commercializing the innovation, OTD will work with a representative of the company to grant a license. FAU markets its innovations because it is committed to looking for the best licensees to transfer them from FAU to the marketplace for the public benefit. The university also has a legal obligation to ensure that innovations funded by the federal government are effectively commercialized. Under FAU policy, faculty, staff, and students cannot represent the company in licensing discussions due to conflicts of interest.
4. What is an option and can a start-up take that
instead of a license?
An option agreement is a commitment from FAU not to license an innovation to a party other than the start-up. It is often used to reserve rights in an innovation while the company evaluates it, explores funding opportunities, and raises the capital needed to fully license the rights
in question. Option agreements include financial consideration to FAU in order to reserve those rights.
5. Are the terms of the option or license negotiable?
No, the preferred option and license terms offered to FAU start-
ups are fixed and if not acceptable to the start-up, a more detailed
and extensive standard option or license agreement will have to be negotiated. Standard options and licenses typically take 3-6 months to negotiate at any university, and it is common for start-ups to incur legal fees with their outside counsel of $10,000-$20,000 or more on a license negotiation, depending upon the extent of the language changes requested by the start-up.
6. Will FAU assign intellectual property rights to a
start-up?
No, FAU does not assign intellectual property rights to start-ups. When appropriate, FAU may grant an exclusive license after deciding that the start-up is the best candidate to commercialize the innovation.
7. Can a start-up get an option or license without
being incorporated?
A start-up must be legally incorporated or registered in order to execute an option or license agreement with FAU. The university must be able
to sign an agreement with a legal entity, not an individual.
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